Eastern region States are cashing in massively on the power shortages in the rest of the country. Between April-January this fiscal, they exported close to 11,000 million units (MU) to other regions, although this has meant load-shedding in their respective States. Even on a conservative estimate, the power exports could have fetched them upwards of Rs 5,500 crore during the 10-month period.

Led by West Bengal, Jharkhand and Orissa, the eastern region alone accounted for nearly 60 per cent of total inter-regional power exports that took place during April-January this fiscal. Sale of power to the grid could fetch up to Rs 10 a unit during peak hours, prompting States to wheel power to others despite crippling shortages back home.

The three main ways of short-term transfer of electricity between regions is through the bilateral route (directly between distribution companies and through power traders), through the two operational Power Exchanges (IEX and PXIL) and through the UI route (the incentive mechanism allowing inter-regional exchanges under the current Availability Based Tariff regime).

Of the total inter-regional exchanges of 19,181 million units (MUs) that took place between April-January this fiscal, eastern States accounted for 10,839 MUs or 57 per cent of the total exports.

During April-December, the weighted average sale price for electricity transacted through traders was Rs 7.90 per unit. For electricity transacted through Power Exchanges, it was around Rs 6.50 a unit while the price of electricity transacted through the UI mechanism was Rs 5 a unit for the integrated NEW (North-East-West) grid. Even if an extremely conservative average traded price of Rs 5 a unit is taken, the sale of around 11,000 MUs could entail revenues to the tune of Rs 5,500 crore.

The top five entities that are selling electricity include the West Bengal utility, Damodar Valley Corporation (a joint sector project set up by the Central Government, West Bengal and Jharkhand) and Orissa’s Discom.

Of the power exported by the eastern region, much (6,678 MUs or over 61 per cent) has been wheeled in by the northern states, with major beneficiaries including Rajasthan and Madhya Pradesh. Maharashtra and Andhra Pradesh have also been importing power in a big way.

The exports by the eastern States is despite a deficit of 859 MUs in the power supply position in West Bengal, a 265 MUs deficit in Orissa and a deficit of 220 MUs in Jharkhand for the April-January period, according to provisional CEA data.